What The Entertainment Industry Could Learn From Al Neuharth

from the don't-sue-'em,-make-them-help-you dept

No matter what you feel about USA Today founder Al Neuharth (who certainly elicits quite a strong reaction from many people), he revealed a very interesting story about a decision made in the early days of USA Today in an interview on the 25th anniversary of the paper. It's a story that the entertainment industry, busy in its plan to sue college kids, could learn a lot from. Apparently, soon after USA Today launched, some college kids stole some of the cool looking vending machines USA Today was using. Neuharth then took what may seem like the counter-intuitive step in dealing with it:

"Our lawyers, as lawyers are wont to do, said, "Let's sue the bastards." And I said, "Like hell we will. Let's find them and we will make them our distributors." And we did that."

Every time we write about why it's dumb for the entertainment industry to enforce its copyrights in doing things like suing YouTube, people yell at us for taking away the rights of content creators. This is a misreading of what we've been writing. We've never said to take away their rights -- just that they can be better off if they choose, of their own will, to ignore those rights and use the fact that people are using their content to their advantage. It's the same thing here. Neuharth clearly would have been within his rights to follow his lawyers' advice and "sue the bastards." Instead, he realized that it could make a lot more business sense to realize that these "criminals" could be a lot more useful. Clearly, they were "fans" of USA Today, so why not use that to the company's advantage and make them distributors, helping to promote USA Today? It's the same thing with the entertainment industry today. For those who decide not to enforce copyrights, and actually encourage their best fans to promote and share their content for them, it can help get a lot more attention, a lot more fans and open up many new avenues for profit.

I'm thinking that the fact they stole the machines didn't necessarily mean they were fans of USA Today, maybe they had other uses for the machines? Just a thought that ran through my mind, maybe there's more to it than it seems...

But...

I'm thinking that the fact they stole the machines didn't necessarily mean they were fans of USA Today, maybe they had other uses for the machines? Just a thought that ran through my mind, maybe there's more to it than it seems...

Except that the newspaper's been around for 25 years, so there had to be something brilliant in their marketing strategy.

"We've never said to take away their rights -- just that they can be better off if they choose, of their own will, to ignore those rights..." is that really all you've been saying ? It seems to me that techdirt's line has also included preventing the industry establishing extended rights and that these new rights -which for practical puroposes they have established since not many people have the time and finances to tackle in court- should be taken away. I hope techdirt isn't softening it's line.

Part of the problem...

Every time we write about why it's dumb for the entertainment industry to enforce its copyrights in doing things like suing YouTube, people yell at us for taking away the rights of content creators.

Part of the problem that I (and I'm sure other people as well) is that all these lawsuits, takedown notices, and other nonsense isn't coming from the content creators its from the content owners. Yes there is a difference. It's once in a great while that you see artists suing fans, issuing takedown notices to hosting sites, and giving outright false statistics about file sharing. But when is the last time a week has gone by without some lobby organization, someone on Capital Hill that represents the industry, or the RIAA/MPAA itself putting out a report about how badly file sharing is killing their industry?

You've got to be kidding me. The ONLY thing you can learn from the founder of USA Today is that you can get rich producing a newspaper that is dumbed down for a third grader and has pretty flashy pictures and graphs instead of actual content.

One issue I have when folks talk about the content creators (say, the singer) and the label. The label profits off the sale of the music and gives some of that to the singer. For some reason, that singer decided it was in their best interest to sign with the label. If the label goes away, then the benefits that singer received from the label will go away also.

Insecure Content Providers

The lawsuits make it pretty evident that copyright holders are somewhat insecure of being able to create content that eclipses the quality of what's already done, uh 70 years after the death of the author, right?

It sickens me that disney goes back to the USPTO every time their copyrights are about up to lobby congress to extending copyright law. Start making something new, and more innovative!

Thinking like that is what separates the real genius from the people who just simply aren't smart enough to come up with an original idea.

Lucky for us, many people have thought 'outside the box'. It's brought a great number of things to society.

If he continues to think like this - USA today may well survive the 'revolution' of Media.

Sorry you ol' dusty RIAA/MPAA and Big Media CEO's - times are changing and you can either take advantage of the change and be a winner or wait for someone else to. Because, it's inevitable that someone will, at some point, change this whole playing field of media as we know it.

It's akin to when Franklin discovered electricity. They had it - but they didn't know what really to do with it. And then along came Edison... the rest is history.

Steal from us, and we will give you jobs

Yeah, Mike, so innoviative. Please steal music, and then your punishment will be a job in the music industry. Actually it is kind of a punishment with the lower than standard wages, and all the name dropping.

Re: Steal from us, and we will give you jobs

As soon as you finish patting yourself on the back for you cleverness please the read comment #12's reply to comment #4. No one said this is the magic bullet answer that will solve the recording industry's woes but its an example that at least trying to think outside the box may yield good results instead of the now current reaction of suing anyone that may pose a threat to their strangehold and occasionally buying some favors on Capital Hill.

#4 There is a difference between turning your best customers into distributors and all of your customers into distributors.

This is what would be called "a good instructional example," not "an example that should be followed by all companies for all members of the public"

#8 You really can't just say, screw the label, I support the singer.

Sure you can. When you make that separation, look at whether the artist also makes it. Some do. See Prince (recent articles here) or Trent Reznor (recent articles, also his 1991 battle with his label which resulted in a label change and a major difference to the next album he made), KMFDM (started their own label after being denied control), etc. Many musicians don't make the distinction, but the ones that do certainly deserve that kind of moral support.

Reznor had a battle with his label, but there must have been a good reason he signed with them in the first place. If you remove the label, obviously you are removing some advantage the artist received in the first place.

If the label provided no advantage, why would any artist sign with them?

Re:

Reznor had a battle with his label, but there must have been a good reason he signed with them in the first place

riiiight, because record labels NEVER get people to sign under false pretenses. labels are ALWAYS good to their artists, give the artist full control over their creations, and no artist has EVER filed suit for breach of contract.

the music industry is FULL of honest executives that just want to make great music, just ask prince and george michael.

If the label provided no advantage, why would any artist sign with them?

It's not that the label provides no advantage, or that the label and the artist must always be at odds. Labels certainly can provide advantages, such as distribution, merchandise, and advertising. But you can indeed say "screw the label, I support the singer." I don't buy records from certain labels, I buy records from certain musicians. If a musician leaves a label because he wants more control than the label is willing to give or something like that, I support that and I don't feel sorry for the label one bit. If the two parties do get along, well that's great.

Again, the labels do often provide advantages. But how often would the artist be better off in another situation? If an artist wants people to receive his music in a fashion that the label doesn't like, and the label takes action against it, I do say screw the label. Ditto when the label screws the artist out of money, by predatory contract or otherwise, forces a different musical direction because they think it will improve sales, etc. This stuff does happen, and an artist who feels strongly about such things should seek those things that a label provides elsewhere, be it another label or becoming independent. Becoming independent or creating your own label wasn't really possible in decades past if an artist wanted significant exposure or sales, but now it is becoming more and more possible thanks to the internet and digital content; and if labels don't wise up and start providing more value to the creators they work with than they have in the past, I hope the market and the artists do wise up, and slap them in the face accordingly.

I agree, the labels are not great for the artist in all cases and Trent (me and him are buddies, well, maybe not) probably had good reasons to start his own. The issue is if the labels go away, those good things also go away so people like Trent wouldn't have had that opportunity in the first place.

Re:

The issue is if the labels go away, those good things also go away so people like Trent wouldn't have had that opportunity in the first place.

But the thing is the reason the labels are in danger of fading away is that they are not doing those good things anymore (well at least they aren't doing them for a reasonable price, and I mean that in more than money) for the artists.

If Trent and others acts that started around the same time he did were to start today there's a good chance they would start their own label or hookup with one of the small labels that allow for more creative control to start with.

If the labels were still doing those good things (or due to the major changes in technology in recent decades try new good things) then there wouldn't even be an issue of the big labels trying to take over every aspect of music.

Instead of taking a step forward into the future the entertainment industry (movie and music) has its feet planted in comfortable position and will use as many lawsuits, studies based on false data, and lobbying organiztions as they have to money fund to stop progress.

Re: #18

The issue is if the labels go away, those good things also go away

The current big labels won't go away. There will always be a Britney Spears or a Backstreet Boys for them to sign or create and push out via whatever venue they can. But they are not necessary any more for a new artist to get exposure.

Young acts are setting up MySpace pages or websites or using iTunes, which have proven to be very effective at marketing and distribution--mostly digital, some physical--directly into the hands of the consumer. For digital distribution, this is a more pleasant experience. For physical distribution, it means an extra week or so wait for mail delivery, but for me personally, if I care about the music, I typically don't mind waiting.

The only thing left for a big label to do is finance a tour, and they barely even do that now. Those good things do not disappear in the absence of a label. Big labels would like you to believe that they do, but it's not true. If they want to maintain their top-down, strangleholding business model, they should stop trying to attack people every which way, stop spending energy trying to contain an unstoppable force, and focus on ways they can make things better for both the consumer and the creator. This is a case of the middleman becoming irrelevant and struggling impotently to avoid it, but they are going about it all wrong--I daresay even to the point of causing their own irrelevance.

And I will imagine that as more and more artists come out on their own, doing it themselves, you will see more and more of them talking about how filesharing is wrong, how they don't want their creation out there being traded.

Now, they make their money off concerts, not record sales. How will they feel if they have to do everything themselves, do their concerts that they normally do, yet receive nothing additional?

There have been success stories that grew entirely out of MySpace and, yes, led to big tours. Whether labels picked up those people and financed those tours, I don't know because I don't keep up with that. But that's not my main point.

If you think that labels have to bring frivolous lawsuits, demand other, unrelated companies police the public for file sharing, and demand new laws for their sole benefit, or that musicians can't possibly do anything without them, go ahead and think it. I think musicians and fans can get along without such treatment. Please notice, I never said all labels have to go away. What I mean is, labels should act better, or they should not be surprised when their acts move on to smaller, more progressive labels. Maybe not "screw the labels." But certainly screw the mentality they have today.

If you're a regular Techdirt reader, you may have noticed another point made by the writers over and over: Attacking file sharing in a vehement, violent fashion is absolutely wrongheaded and will not accomplish anything. There's no way it can work. Technology can always provide a way around other technology. If the labels can act intelligently, they will stop trying to squash ants on gravel with a flyswatter, and start doing things that make people /want/ to give them money. This cannot be accomplished by making the competition worse, by trying to sue, etc. It can only be done by making their product better, or offering a more compelling product (let music be free and charge for merchandise, access, etc., instead)

I happily buy CDs. I like the artwork. (I don't pay full price for them, however, I look for them used or on sale--$20 is too damn much for an album!) But I'm a dinosaur. Many people today don't give a toss about the packaging or artwork. So what benefit does purchasing the music offer over downloading it, for them? None. How can you expect people to pay for only the music when they can get it free? They won't. Do NOT draw a parallel to entering someone's unlocked (or locked) house uninvited and taking cash, it is certainly not the same thing. What labels need to do is to offer something else that people do want and will pay for. There's two basic categories: 1. a physical good that can't be copied with simple electronic devices everybody has in their home 2. An experience.

Why the Entertainment Industry sues College Studen

College students don't download more than anyone else in the nation who has access to reasonably fast internet. But the RIAA and the MPAA use them as scapegoats because:

1) They can pressure or pay colleges and universities into giving up students' identities based on their ISP numbers. It's harder to do that with residential broadband service.

2) They know that college students aren't going to want to risk their academic or post-graduation careers, and will therefore be more amenable to shelling out $3,000 to make the matter go away.

3) No one feels sorry for college students. College students are perceived as loud, partying, spoiled kids who are privileged enough to be able to afford four years of "growing up" before they enter the real world. People will get mad if you sue the 13-year olds, the mothers, and the senior citizens, but they won't really sympathize with the college students.

It's a deliberate choice, and it's wrong regardless of how you feel about the whole downloading issue.